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Many writers speak of publishers purchasing rights when they sell a manuscript to a commercial trade publisher to put out as a book. While this sounds great, and it generally is, it's not entirely accurate.
First off, the publisher hasn't purchased anything. What they're doing is risking some of their money in a way that some personal injury lawyers do. They make a risk analysis of the manuscript or personal injury. They use their experience and knowledge of the industry to determine just how much will be sold or awarded. Then they put some of their own money at risk by giving it to the writer or injured party as an advance that's actually a grant with certain stipulations attached concerning repayment. If the book fails to sell or the court finds against the injured party, then no repayment is due and it's a pure grant. The publisher or lawyer took a chance and lost money, but gained more experience and knowledge for the next client.
At this point, I'm going to concentrate only on publishers so this remains easy to understand because we're interested in the stipulations that mean something to writers. There are far too many involved with injured parties and we don't want to lose track of publishing which is our focus.
So, what are those stipulations? They're really quite simple. If the book sells, the publisher receives all the profit until the advance is paid out. It's at this point that the advanced money becomes not the publisher's, but the customers' because the publisher is recovering what he risked from the book's customers until the advance earns out. After that, the publisher and writer share in the profits. That is what makes the advance system so attractive. The publisher doesn't actually purchase anything. The publisher merely risks some money as an inducement to the writer to let the publisher handle the manuscript as a product.
Yet this goes back to the beginning of what I stated. The publisher hasn't paid a single thing at that point if the book has earned back the advance the publisher gave to the writer. In the beginning, the publisher was gambling, not purchasing. So, how did the publisher purchase the book and what does this have to do with copyright now that some publishers are demanding that the copyright be placed in the publisher's name rather than that of the writer?
Well, since the publisher didn't actually purchase the book, then the publisher shouldn't have the right to put the book's copyright in the publisher's name… UNLESS the publisher actually pays the writer for the book. Of course, this means the publisher will have to look at future sales far beyond what the writer might foreseeably receive since the writer is now selling rights that would survive the writer's life. That's only fair since such monies are all the writer will now have to pass on to his family upon death. After all, if the copyright becomes the publisher's, then there will be an incentive for the publisher to gain freedom from sharing with future inheritors under the current system so they won't have to maintain a huge database of heirs for each and every author they publish in order to pay royalties when those accrue beyond the author's death. Any such system would inevitably end up in court because some of the author's survivors will be sure to contest the share they receive if the author doesn't will the proceeds to a specific survivor. Even if the author does, it's unlikely that the survivor will have done so and eventually the publisher will end up in court with the nastiest of lawsuits eating away at the profits and the smaller those were for some books, the quicker the publisher will want the case ended.
So, is P&E against publishers owning the copyrights? The answer is not entirely, provided the publisher actually pays a sum certain to enrich the author appropriately. Why not entirely? Well, by owning the copyright, the publisher also gains the power to change the story at will. This means the author's work might easily not represent what was written originally thus imparting different meanings or intentions contrary to what the author believed. Furthermore, by owning the copyright, the publisher presumably would gain other rights such as to the characters. Mind you, in some instances, that might not be entirely bad since it could limit how many sequels an author might write, but that's unlikely. More likely, the publisher would then hire other writers to pen those sequels for less money under write-for-hire contracts. That would hurt the original writer who could then be locked out of enjoying the profits from merchandizing and films and so forth that a successful series might generate. So, for P&E to endorse publishers owning the copyrights, there would have to be safeguards written into every contract.
However, as we've already seen because of the introduction of the Internet and electronic publishing, not every contingency can be foreseen. Therefore, it's not to the author's benefit to sell every possible right bundled in copyright to the publisher when copyright already includes those contingencies and contracts don't. This is especially important since those contracts not only fail to mention new technologies by which a manuscript might be published, but also a way of properly dividing the profits. After all, how can they? There's no way of knowing beforehand how the economies of scale will affect future technology and profitability. This leads again to legalities where the writer takes the publisher to court because the publisher unilaterally made the judgment on what was fair.
Consequently, even though this is something that might come to a proper understanding benefiting writers equally, for now it's not. For that reason, P&E is against publishers having the copyright in their names rather than the authors'.
Opposing viewpoints are welcome.